RAY HADLEY:
Scott Morrison good morning.
TREASURER:
G’day Ray.
HADLEY:
You’ve just comes back from Germany have you, on the last few hours?
TREASURER:
We got back in late last night from the G20 meeting, I can tell you there’s not any of those G20 economies, every single one of them would want to be Australia. That’s the feedback I was getting from them while I was over there. Australia’s economic record is very strong when compared to other the countries that sit around the table, the other good message coming out of it was that the world economy is better than it was a year ago, and the outlook is better than it was a year ago, so things are better and things look like getting better. I think that’s an important positive message that’s coming out of that forum, and that’s certainly true for Australia.
HADLEY:
What about Mr Trump’s America first approach to global issue and the lack of commitment maybe from G20 members on free trade?
TREASURER:
I had a bit to say about this when I was there. I met with the new Treasury Secretary Steven Mnuchin and we made sure that trade and support for trade was part of the official outcome of that meeting. I said to them what Bill English says, the New Zealand Prime Minister, no one gets rich selling things to themselves. I think that went over pretty comprehensively. If we want to keep growth happening around the world, particularly here in Australia, then trade is an essential part of that. There’s acknowledgement of that, the Americans understand that as well, we had to do a fair bit in terms of getting, whether it was the Europeans, the Chinese, the Americans all to a point where they could agree on a formula of words, but that’s for bureaucrats and officials. At the end of the day, everyone understands the importance of trade.
HADLEY:
I’m glad you raised that, because I had a very interesting conversation about a whole range of things with the Assistant Minister for Social Services, Zed Seselja, this morning, after that I went back through the filed and found some things in relation to energy which is a big talking point at the moment, particularly with a 23 per cent RET that you’re talking about as a Government, 50 per cent that the Labor Party is talking about and the Greens are talking about 120 per cent. That’s not possible. But we are selling coal, clean coal, to Japan, and they’re in the process of building 45 coal-powered fire stations, you said we don’t get rich by selling things to ourselves. At a time when we’re closing down Hazelwood, and other power facilities, the Prime Minister is so concerned about it he has announced Snowy Mountains mark two, why are we closing these places down?
TREASURER:
Hazelwood as a case in point, that’s actually beyond its economic life currently and that’s been in train for some period of time, and there’s a very big clean-up bill on that site, the point I’ve made on your programme before Ray, and that is in the next 10 years, we’ve got five stations which will reach their economic life, which is around 50 years. That’s how long these things tend to run for. Now they combined to provide over 8,000 megawatt hours, now that is the entire peak load of Queensland, I think it’s about four times South Australia, and about half New South Wales. Coal remains part of the energy mix in Australia importantly, for many years to come, and we need to ensure that if you’re going to ultimately have to switch something off because it’s reached the end of its life, then you’ve got to be able to switch something else on. That’s what we’re focused on as an energy sub-committee of cabinet, and you’ve got to look at all the things that are necessary, and Snowy mark two is an important part of that, as is the project down in South Australia which is another pumped hydro project at Cultana, where we’ve already made some announcements on that. Equally, making sure that what you’ve currently got switched on you don’t switch off.
HADLEY:
That’s the problem. We switch it off in nine days, maybe in four years we get Snowy mark two up and running, in four years, what do we do in the interim, given that this base load power coming from Hazelwood supplied a lot of other places? What do we do?
TREASURER:
I think Liddell is the next one and that’s in 2020. It’s important that all of these stations can work to at least what they’re currently slated for, and we need to be very sure about that. But you’ve also got to be developing these other areas, I mean the lack of planning that’s gone on over the past 20 years on this sort of thing is a big part of the problem.
HADLEY:
That’s because they wanted to build wind turbines and put things on our rooves.
TREASURER:
On top of that, didn’t solve the storage problem. If you generate your energy from those renewable sources the problem is when the wind stops blowing, the sun isn’t shining on a particular day, you’re left with nowhere to go. That’s the beauty of what the Prime Minister has been talking about with the pumped-hydro, that works whether it’s rain, hail or shine, wind whatever. So you’ve got to have these other options and Snowy mark two, it’s been on the drawing boards for many, many years and it’s taken Malcolm Turnbull actually to stump up and actually get this thing back on track.
HADLEY:
In four years.
TREASURER:
It will be a big task, but it’s an important one. The first one was a big nation building initiative…
HADLEY:
But you haven’t answered the question Minister, what do we do when Hazelwood closes in nine days? Don’t worry about Liddell in 2020, what do we do when it closes in nine days?
TREASURER:
We’ll have to rely on all the other assets that are currently out there Ray. You can’t just switch other things on overnight. What I’m saying is, with Hazelwood closing which was cheered on by the Labor Party and the Greens, they were the ones who wanted to see that closed and they have achieved that. What we now have to rely on is making the best use of all of the resources and all of the assets we currently have in the system. Now, the advice we have and Josh Frydenberg could tell you in more about this in detail, is that currently that would be able to be accommodated. That is a proposition that is to be tested and that’s why the Prime Minister last week…
HADLEY:
We hope.
TREASURER:
And that is a fair point but the Prime Minister last week got all of the big gas suppliers in a room and got them to guarantee that the gas would be available for domestic use. Now you have been talking about that on your program, we took action on that last week, got in a room, and said make sure that’s here and they gave that guarantee. I thought that was a very important outcome for electricity users all around the country; households and businesses.
HADLEY:
I know you don’t like talking about poles.
TREASURER:
You like it.
HADLEY:
I heard the news all morning saying that you will be, my words not theirs but when I heard the news at 3 o’clock this morning I thought gee those poles must be good. They were popping the champagne corks in the Liberal national Party and then I get in and see it is 52-48 to the Opposition which is much better than 55-45 but you see I sense something, and Ross Greenwood and Chris Kenny, Ross on my, or Alan’s program, this morning and then Chris writing in The Australian talking about the announcement that we have just spoken about in detail – Snowy mark two has really resonated with the electorate. I am having a feeling that if we get this announcement, which has already been announced on the front page of The Australian and people might have missed it, Australia’s National identity will be redefined on the fundamental principles integration, allegiance and unity and a pointed shift away from welfare and entitlements which is great to see, it is what the conservative Government should be about and we have already had the Assistant Minister on talking about that. And then there it says about free speech and I try to get him to say, what about 18c and he wouldn’t commit to that but he said he is personally opposed to 18C. So, I think if you can do this announcement today and in the meantime silence someone in your own Party about same sex marriage and say, look, we went and said we would have a plebiscite and if can’t have a plebiscite we are not doing anything. That is point one, change 18C, you know what I think will happen, Treasurer?
TREASURER:
Go for it.
HADLEY:
This is my prognostication; you will be 50:50 next Newspoll.
TREASURER:
What all of that boils down to is frankly what I said last week and other times when we have discussed this topic. When the Government is totally focussed on governing and when the people see that we are not distracted by all of these other issues and we are just focussing on the problems that they think are most important. That is the cost of their electricity, the cost of housing, the cost of childcare, making sure that we are getting the nations finances back on track – and that is what we are focused on. So, look, Ray, my response to you in a better week as opposed to a worse week is the same.
HADLEY:
So you do listen to the polls – I’ve got you. A better week as opposed to a bad week.
TREASURER:
My answer is the same.
HADLEY:
What’s that?
TREASURER:
The election is at least two years away Ray. So, what matters is if you govern and you govern well. And if you govern well and focus on the issues that people are most concerned about and are actually delivering solutions on those. In the past week in particular there were two great examples of that. Getting all of the gas suppliers in a room and saying we need you to guarantee that the gas will be there. That was the Prime Minister’s leadership. That is backed up with a very significant announcement around the Snowy Mark 2. We are just getting on with the job of Government. Sometimes Ray that takes a while for that to be observed but it doesn’t change our focus. We are just not distracted. I am preparing a Budget. That is what I am focussed on and they are the numbers that most keenly have my attention.
HADLEY:
Ok, leading in to that a fortnight away from the Budget how are you going to go in relation to what you need to pass through the Senate in the meantime?
TREASURER:
Well, we all know what is there and particularly the measures on welfare changes. The Labor Party wants people to pay higher taxes for higher welfare bills. That is why they refuse to change anything on the welfare side of things. They will be put to the test over this next fortnight. We are very keen to get the changes through so we can have those childcare changes which I think will be very important. They were initiated when I was Social Services Minister and I would be as pleased as anyone to ensure that they get passed over the next fortnight. There was also the issues around the tax cuts particularly for small and medium sized businesses and they will be before the Parliament. While the Labor Party focuses on what is happening at the big end of town, what is most important about these changes right now if you are a business that has a turnover of less than $10 million we want you to pay less tax this year – this year. And give you access to better depreciation, instant asset write-offs all of these things this year. Now, the Labor Party has been opposing that measure since I announced it in the Budget in May. So, they will be put to the test on that in this next fortnight. So, the Government has a clear plan, Bill Shorten is just standing there with this sign that he has which has ‘stop’ on both sides. There is not a ‘stop’ ‘go’ sign with Bill Shorten. It is just ‘stop’ ‘stop’.
HADLEY:
Ok, as always thanks for your time. We will talk next week.
TREASURER:
Thanks Ray, cheers.